Scottish and Southern Electric fined over power failures

Energy firms fined extra £3 million after thousands left without power in winter storms

Energy firms fined extra £3 million after thousands left without power in winter storms

First published in Hampshire Business
Last updated

Regulator Ofgem has ordered energy companies SSE and UK Power Networks (UKPN) to pay an additional £3.3 million after a probe into how they handled last winter's storms.

The firms have already paid out £4.7 million and committed to improvements following the severe weather last Christmas in the south of England. It brings the total to £8 million.

Ofgem said it was more than doubling the minimum payments of those affected by severe weather incidents in the future and has warned the industry that it must learn the lessons of last winter.

Hampshire Chronicle:

It said it found that while SSE and UKPN's southern arms were badly hit by the storms ''they could have done more to get customers reconnected faster and to keep them better updated on what was happening''.

The announcement comes as the Competition and Markets Authority sets out details of a major probe it is opening into Britain's energy market.

Severe weather over Christmas 2013 saw power cuts affect nearly a million homes. Ofgem said SSE and UKPN's power networks bore the brunt of it.

Each had nearly 1,100 incidents, affecting a quarter of a million customers on the networks.

Between them they restored power to more than 95% of customers within 48 hours. But almost 16,000 customers remained affected for more than 48 hours.

Ofgem said: ''The companies have recognised that they must improve their procedures for any future major interruption and Ofgem has today put the industry on notice that any repeat of last year's performance issues will trigger further action.''

The firms have so far paid £4.7 million to consumers under current ''guaranteed standards'' and in goodwill payments.

Hampshire Chronicle:

But the regulator said that in the light of its findings they had agreed to make donations totalling £3.3 million to organisations such as the Red Cross that play a key role helping vulnerable customers during severe weather.

Ofgem also confirmed improvements to guaranteed standards payments to customers who face long power cuts in severe weather, which will come into force in April.

The minimum payout for consumers left without power for at least 24 hours during a severe weather event will rise from £27 to £70.

In addition, the cap for payouts will rise from £216 to £700, while Ofgem also said automatic payments should be made to customers where possible.

It said the changes would strengthen the incentives for companies to act quickly and reconnect customers as soon as possible.

Maxine Frerk, Ofgem's senior partner for distribution, said: ''A power cut at Christmas time is the last thing anyone needs.

''While we recognise the hard work of the companies and their staff who were out working to reconnect customers during the severe weather, the companies could have done more to plan for the weather and keep customers informed.

Hampshire Chronicle:

''This is why we have secured an additional £3.3 million, bringing the total payout to £8 million.''

SSE's payout totals £4.6 million, including £2.3 million in guaranteed standards and goodwill payments and £2.3 million to the British Red Cross, Age UK, National Energy Action, Macmillan Cancer Support, and to a new community fund.

UKPN's payout totals £3.4 million, including £2.4 million in guaranteed standards and goodwill payments and £1 million to the British Red Cross, the Royal Association for Deaf People, Carer's Trust and Citizens Advice.

Comments (3)

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8:34am Thu 24 Jul 14

Linesman says...

What does this mean?

They will increase their prices to recoup the fine, so that the shareholders do no suffer.

So much for 'putting the customer first.'
What does this mean? They will increase their prices to recoup the fine, so that the shareholders do no suffer. So much for 'putting the customer first.' Linesman
  • Score: 6

10:26am Thu 24 Jul 14

befriendly says...

Linesman wrote:
What does this mean?

They will increase their prices to recoup the fine, so that the shareholders do no suffer.

So much for 'putting the customer first.'
Don't fine the company. Fine the directors who are responsible for running it, then I think you'll find things will improve dramatically.
[quote][p][bold]Linesman[/bold] wrote: What does this mean? They will increase their prices to recoup the fine, so that the shareholders do no suffer. So much for 'putting the customer first.'[/p][/quote]Don't fine the company. Fine the directors who are responsible for running it, then I think you'll find things will improve dramatically. befriendly
  • Score: 3

5:04pm Thu 24 Jul 14

Positively4thStreet says...

Lots of nice pictures of pylons..should keep the "I don't like wind turbines" brigade happy.
Lots of nice pictures of pylons..should keep the "I don't like wind turbines" brigade happy. Positively4thStreet
  • Score: 0

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